The unexpectedly destructive weather on both sides of the country is being blamed for the insurance losses. Southern Alberta was flooded by the worst natural disaster in the province’s history earlier this spring, while a record-setting amount of rainfall damaged many Toronto neighbourhoods early in July.
TD Bank announced that the insurance branch of the company lost an estimated $290 million as a result of the disasters. Prior to the disasters, the company was forecasting profits of at least $180 million for the three month period.
The IBC, the national insurance association devoted to increasing the public’s understanding of the insurance industry, describes the two downpours as the latest in a long line of natural disasters in recent years that are taking their toll on the insurance industry as a whole.
Edmund Clark, CEO of TD Bank, says the bank’s losses will likely increase insurance premiums, though TD is refusing to confirm the amount that homeowners will be charged. Residents recovering from recent disasters are unhappy that they will likely lose even more money as a result of the intense flooding.
The Consumer Associations of Canada, an advocacy group that stands up for consumers, believes TD and other insurers are unfairly making Canadians pay for an act of nature. Spokesperson Bruce Cran says insurers play by a very different set of rules.
“I don’t know another business where you can have a loss in one year and add it on to the next year’s prices. It doesn’t work that way except in the insurance industry.”